Going to college can seem like a choice between impossibly high payments while in school or a crushing debt load for years afterward, but one state is experimenting with a third way.
This week, the Oregon Legislature approved a plan that could allow students to attend state colleges without paying tuition or taking out traditional loans. Instead, they would commit a small percentage of their future incomes to repaying the state; those who earn very little would pay very little.
Washington legislators also discussed the idea — which is being promoted by a Seattle-based organization — during the legislative session that ended last week. But it’s still in the discussion stage in Olympia.
In Oregon, the proposal faces a series of procedural and practical hurdles and will not go into effect for at least a few years, but it could point to a new direction in the long-running debate over how to cope with the rising cost of higher education. While the approach has been used in Australia, national education groups say they do not know of any university in the United States trying it.
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The Oregon plan had an unusual, and unusually swift, gestation. Less than a year ago, neither elected officials nor advocacy groups there had even considered it.
It began last fall in a class at Portland State University called “Student Debt: Economics, Policy and Advocacy,” taught by Barbara Dudley, a longtime political activist who teaches in the school of urban and public affairs, and Mary C. King, a professor of economics.
Dudley was referred to John R. Burbank, executive director of the Economic Opportunity Institute, a liberal policy group based in Seattle, who had studied the no-tuition approach. She, in turn, referred the students to him, and they adopted the idea as their group project for the semester.
The students and Dudley later made a presentation to state lawmakers, including state Rep. Michael Dembrow, Democrat of Portland, and chairman of the higher-education committee. The Working Families Party of Oregon — of which Dudley was a co-founder — put the proposal at the top of its legislative agenda, and Dembrow and others ran with it.
“It’s unbelievable that it’s all happened so fast,” one of the students, Ariel R. Gruver, said this week. “We never imagined that we would actually accomplish something like this, and definitely not in such a short time.”
Lawmakers held hearings on the plan, debated amendments, and passed it, with the final vote on Monday in the state Senate. The Legislature’s majorities are Democratic — as is the governor, John Kitzhaber — but the vote in both houses was unanimous. An aide to the governor said Kitzhaber was likely to sign the bill.
“When we talked to legislators, conservatives said it appealed to them because it’s a contract between the student and the state, so they see it as a transaction, not as a grant,” said Nathan E. Hunt, one of the students who proposed the plan.
In the Washington Legislature, the 19-member House Committee on Higher Education discussed the Economic Opportunity Institute’s plan, dubbed “Pay it Forward,” but was not able to wrangle money out of this year’s budget to study the issue.
Committee chairman Larry Seaquist, D-Gig Harbor, wants an actuarial report that studies ways of going about launching such a program.
He’s also concerned how it could affect a student’s eligibility for federal student aid money, such as Pell grants.
Now that Oregon has approved legislation, Seaquist hopes the idea gains more traction in Washington.
“We’ve got to be really creative to increase the output of students with degrees, without expecting huge amounts of money” to come from the Legislature, he said. “That’s what I’m going to be working on this summer.”
The speed and unanimity of the Oregon Legislature offer a sharp contrast with Washington, D.C., where Democrats and Republicans have been unable to agree on a new law on federal student loans, resulting in the doubling of interest rates as of Monday.
“Everybody is concerned about the problem of student debt load and the rising cost of tuition,” Dembrow said. “Not everybody agrees on the causes, but everybody agrees on the effect. We all hear about it when we’re knocking on doors, running for office.”
For many legislators, he added, the issue has become personal. “It affects their kids, their grandkids,” he said.
The bill instructs the state’s Higher Education Coordinating Commission to design a pilot program, which would then require the Legislature’s approval. For now, only the broadest outlines are clear.
The idea calls for the state to provide some money to get the program running — how much would depend on how big the pilot is — but that in the future, payments from former students would sustain it.
The plan’s supporters have estimated that for it to work, the state would have to take about 3 percent of a former student’s earnings for 20 years, in the case of someone who earned a bachelor’s degree.
Seattle Times higher education reporter Katherine Long contributed to this story.